New Zealand’s government has decided to block the $56 million purchase of local farm Lochinver Station by Chinese company Shanghai Pengxin.
The government said it was not satisfied that the sale of the Lochinver Station would be of substantial benefit to New Zealand, which is a key requirement for a big land purchase.
The move comes after the body that oversees bids for sensitive assets in New Zealand had approved the sale.
There have been growing concerns about foreign land ownership in New Zealand.
China is New Zealand’s biggest market for many dairy and meat products. Dairy products are also New Zealand’s biggest export.
Shanghai Pengxin said in a statement that it was “surprised and extremely disappointed with the decision and will be considering our options”.
The 13,800-hectare Lochinver farm is located in North Island and is used to breed sheep, as well as cattle for beef and dairy products.
The Chinese government has encouraged its companies to look to overseas markets to meet the demands of its growing consumer class.
Stevenson Group, the company selling the farm, said it was also disappointed by the outcome after a 14-month process.
“We are unclear as to why this property is different to the many others that have been approved through the Overseas Investment Office process, given the obvious benefits both to the farm and to Stevenson Group,” the compny said in a statement.